Tex. Ins. Code §981.203 — what it says, and how the exam tests it

Sec. 981.203. QUALIFICATIONS FOR SURPLUS LINES LICENSE. (a) The department may issue a surplus lines license to an applicant who the department determines complies with Subsection (b) and is: (1) an individual who: (A) has passed an examination under Chapter 4002 and department rules; and (B) holds a current license as: (i) a general property and casualty agent authorized under Subchapter B, Chapter 4051; or (ii) a managing general agent; or (2) a corporation, limited liability company, or partnership that: (A) has at least one officer or director or at least one active partner who has passed the required surplus lines license examination; (B) holds a current license as: (i) a general property and casualty agent authorized under Subchapter B, Chapter 4051; or (ii) a managing general agent; and (C) conducts insurance activities under this chapter only through an individual licensed under this section. (a-1) Notwithstanding Subsection (a)(1)(B), an individual is not required to obtain a general property and casualty agent license to hold a surplus lines agent license if: (1) the home state of each insured is Texas; (2) the individual is a nonresident of this state; (3) the individual is licensed as a surplus lines agent in the individual's state of residence; (4) the individual is not required by the individual's state of residence to hold a general property and casualty agent license to become licensed as a surplus lines agent; (5) the individual has provided information acceptable to the commissioner that the individual's state of residence does not require a general property and casualty agent license for a surplus lines agent license; (6) the individual's state of residence does not require a surplus lines agent to search for the availability of insurance in the individual's state of residence before the insurance is placed through a surplus lines agent; (7) the individual's state of residence allows a licensed general property and casualty agent to search for the availability of insurance in the individual's state of residence; (8) the individual has a professional relationship with, and each transaction is conducted through, a person who: (A) is a licensed general property and casualty agent in this state or in the state of each transaction; and (B) searches for the availability of insurance in this state before the insurance is placed through a surplus…